Naturally, this is starting to cause a panic, because all those pesky climate targets enshrined in law aren’t going to be met.
Range anxiety and costly insurance, high monthly payments and low resale values are the most serious obstacles.
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Cheap EVs wiould plug a part of the drawback gap, but the tidal wave of lower-cost Chinese imports will wreck domestic manufacturers, and the only solution to that on the table is 100% tariffs. Here’s the story:
EV sales in Europe and the US are down and if governments want them to recover it may have to be at the financial expense of their own economies, and a lower standard of living for the people.
By 2035, the International Energy Agency (IEA) says there will need to be 790 million EVs to hit Net Zero by the middle of the century.
That implies growth in sales-growth of 27% every single year
China’s largest EV manufacturer , BYD, has been vying with Tesla for the number-one spot.
BYD also saw a slowdown between January and March.
And EV sales in Europe fell more than 10% year-on-year in the final quarter of last year – although in the U.K. total sales are running up on last year, only because of fleet and corporate buying, not because of individual buying
Global sales of the world’s largest EV maker, Tesla, were actually lower in the first quarter of 2024 than in the same period in 2023
In the U.K., analysts say strong EV sales in recent years were fuelled by company car purchases, thanks to extremely generous subsidies.
But the household market is proving a tougher nut to crack, with people saying they are mostly put off by the high cost and the general uselessness of EVs.
The average price of a new EV in the US is over $60,000 (£47,433).
Prices are similarly high in Europe and the U.K.
Large state subsidies and greater production efficiencies mean the average cost to a Chinese consumer is just $30,000.
BYD’s Seagull hatchback sells for less than $10,000.
China is also making massively more EVs than its domestic market needs – it could easily flood the U.S. and European markets with cheap cars, but that is prevented by 100% tariffs.
Here is the dilemma for European and U.S. politicians. They want cheaper EVs to facilitate the climate transition, but not at the cost of undermining their own car manufacturers – the likes of Ford and Volkswagen – and local jobs.
In fact, the talk is of raising tariffs and other trade barriers on imports to keep out ultra-competitive Chinese EVs.
That’s precisely what U.S. President Joe Biden did this week with a new 100% tariff on Chinese EV imports.
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The hope remains used EV sales will increase.
But as any reader of this website knows, the unlikely prospect of there being any used EVs market is next to zero. Who would want to put a $15000 battery in an 7 to 8 year old EV?
EVs are set to be one-owner commodities, like a washing machine or vacuum cleaner.
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If prices of new EVs stay where they are, there will be a rocky road ahead for Net Zero:
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